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Joystiq interviews Elan Lee of 42 Entertainment

For most gamers, 42 Entertainment gained notoriety after creating i love bees, a massive Alternate Reality Game (or ARG) that served as marketing for the launch of Halo 2 on the Xbox. Since then, Elan Lee has been busy. 42 invited poker fans to graveyards across the States as part of the promotion for GUN, and helped launch the Xbox 360 with a unique "casual ARG." Recent projects, however, are pushing Alternate Reality Games away from the world of marketing, and giving them a life of their own. In his chat with Joystiq, 42's VP of Experience Design discusses Cathy's Book, an attempt to design an ARG under the guise of a young girl's diary. We also discuss Microsoft's ARG mishaps with the Our Colony campaign, and EDOC Laundry, the first alternate reality clothing line.

And it just so happens than Elan is wearing one of the code-embedded garments during our interview.For starters, great shirt. Is this your favorite piece of EDOC apparel?

You know, my favorite EDOC shirt is one that's coming out next week. We've got a winter line coming out with these really cool hoodies and sweatshirts, and long-sleeve shirts. It's this very cool serpent print, with a really fun code on it, and I'm very excited about it.

Are you excited because of the design, or because of the code?

My favorite shirts are always ones where the code compliments the design. One of the main problems I had with Season 1, the shirts that are currently out, is that we designed all the shirts, and then thought "Holy crap, we've got no time. Let's just throw codes on all of these." And we just found random ways to throw on the codes. For Season 2, we had a lot more time, so I got to sit down with our art director, Shane Small, and we designed them all at the same time. So it was "Well, what if that guy's head was tweaked a little to the left, and it was a weird semaphore type of thing?" and "What if that strange emblem was..." So, all of my favorite shirts are ones where the code doesn't seem slapped on, and it seems like this really wonderful synergistic merge of code and design.

So your official position at 42 is "Vice President of Experience Design."

Yeah, that title has changed many many times.

What has it been before?

Um, it was "Vice President of Design," it was just "Founder," it was "Interactive Design," it was... you know. Because we've got one of those strange companies where no one has a classic title, or a classic role, our titles are very fluid. Ultimately, we've got to just put something on the business cards, so we're sorta forced into that corner.

So you have a little fun with it.

Well, the idea behind Vice President of Experience Design, the term "experience design," was when I was sorta forced to sit down and think about what I do, I thought that probably the most important thing that I do is control how our users, how our players, experience the entertainment: how they experience a story, how they experience a strange narrative. And I thought if I focus on that, that probably encompasses more of what I do than any other term I can think of.

So what is your role? What do you offer to 42?

If you cut up all our projects into two basic elements, there's always the story, and the way that story is delivered. That's really rough, obviously. There's a million more parts, but let's call it those two parts. My role is to orchestrate that second part. My role is to take really cool stories and find ways to put them in front of people in ways that they've never experienced before.

You touched upon this in your talk yesterday, but 42 Entertainment has previously done a lot of marketing work, and you guys are just now starting to move away from marketing with EDOC Laundry. But from the website, it doesn't actually look like EDOC is a part of 42 Entertainment at all.

No, it's a completely standalone entity, actually, with different founders, and a different financial model.

But do you internally credit 42 for EDOC, or is it so separate that it's not possible to do so?

We have employees in common, but that's about as far as it goes. Although, EDOC was based on many of the learnings that came from 42, so as far as how to build a cool mystery, and how to tell a cool story. It's just that in this case, I met up with a bunch of my friends in the clothing industry that said "Ooh, we want to play too." So we started this new company.

So in terms of commercializing ARG's, in one way you've taken it to a completely different company. But Cathy's Book seems to be very explicitly a 42 product.

Exactly. Cathy's Book is 42's very first experiment in a product. Our dream is, of course, that we want our own intellectual property, and we want to promote our own ideas, and we want to create something start-to-finish that does not support another property. You know, why don't we just try to run the whole show, at least once?

So Cathy's Book was our very first attempt at that, because the problem with that is "Oh my god, how do you make money off something like that?" So we've broken it into three basic models. You can have a product -- Cathy's Book, and you'll see more books from 42 coming out next year. We've said "Okay, there's a subscription model," which as I was talking about yesterday, Majestic tried to do, but ultimately may not be appropriate for this kind of product. You'll see some creative interpretations of the subscription model coming out next year, but ultimately it's experimental. And I have my own healthy doubts about it.

And the third one is product placement, or banner ads, or things like that. Ad revenue, basically, and I think that is probably the best fit. But it's different from movies or TV. We've all seen really bad product placement in TV and movies. It looks so fake and so contrived. But if you think of an ARG, the whole point of an ARG is to engage the audience member in kind of this bizarre "trust dance," this concept where they want desperately to believe that this stuff is real because it makes it more fun, and the role of an ARG is to do everything in its power to make them not feel stupid about taking that leap with us. And we are in this bizarre position where product placement actually enhances that. If the characters in your story are doing real things, are going to a restaurant that actually exists, that makes the game better, rather than worse. That kind of product placement lets you take that leap with us so much more easily. Because "Oh my god, what if this thing is real? What if this person does exist? What happens if I go to that restaurant? What happens if I buy that product? What if... what if... what if..." So that's the kind of model I'm most excited about as far as creating products in the future that do not support other people's products.

You know, a similar thing is actually happening in video games right now, in terms of in-game advertising. And there's controversy over it there as well, and questions of when does it disrupt the 'bubble' and when is it actually lending itself to it.

Don't get me wrong. Even in ARG's there's a fine line. I know first hand that you can absolutely butcher this concept if you insert things in the wrong way. If it feels contrived, if it feels forced, you've accomplished the exact opposite. Your realism is just shattered and that bubble bursts. But I think ARG's are in this very unique position. The reins are a lot looser, and we can experiment a lot more than movies, TV, or even video games have traditionally been able to do.

So, Cathy's Book is your first attempt at commercializing. It's a Young Adult novel, aimed at a young female audience. Why did you go for that audience first, before any others?

Our staff writer, Sean Stewart, who's an award-winning science-fiction writer, it was an area he was really fascinated with. He has two young teenage daughters, and he really wanted to try to create a product for them. It is a huge market; it's really just enormous. And in some senses, we kinda looked at it as "If we can do this, we can probably do anything." (laughs) So, we knew that Sean could write a good story, we knew that there was an audience out there for it, and we knew that, if done right, the concept of a book that is fun to read beginning to end -- but also lets you poke at it, and it'll poke back a little bit -- we knew that a teenage female audience would be really attracted to that, or so we hypothesized. And the book just made it to the New York Times Best Seller Lists.

Congratulations.

Thank you. So, so far that experiment has gone very well and validated a lot of our assumptions.

Let's talk about Xbox 360 marketing. You guys did Hex 168 for the 360 launch, but before Hex even started, Microsoft ran the Our Colony campaign, which I'm sure you're familiar with. What were your thoughts about that campaign? Since a lot of people from the start were assuming it was 42. But at a certain point, it started getting sloppy, and people began reconsidering whether or not it was something actually put together by the i love bees team.

Well, first of all, oh my god is that flattering! If people see a product that starts to go poorly, and that is the reason they think it can't be us, we're in a really good place with the community. And it's something we've worked really hard to establish, that our products are of a really high quality, and to see that the audience is responding to that, and building their assumptions off of that... Wow, it doesn't get better than that.

I think that Our Colony did a lot of things right, and a lot of things wrong. Like any other ARG, there is no rulebook, and there is no reference to look at and say "Let's imitate that, because that's the right way to do it." They were trying a whole bunch of new stuff. We watched them very closely, and learned a lot from their mistakes. But ultimately, the thing that we are allowed to do that Microsoft is not -- and perhaps one of the reasons that you haven't seen "Our Colony 2" -- is because Microsoft can afford to take a risk like that about once. And if it doesn't work, they have responsibilities to the stockholders, they have responsibilities to the internal teams, and they have resources that have to be allocated in a certain way, because they're big and they're huge and they've been around for a while.

Whereas a company like 42 is much smaller and much more experimental. We can afford to make a product, make a ton of mistakes, and then iterate. One of the reasons that I think our fans are enamored with the quality of our products is because we've learned those lessons early on. We've been doing this for three, four years now and we've made tons and tons of mistakes, and we're getting really good at not making those mistakes, again because we can afford to try and iterate and do it again and again and again, in a way that a company like Microsoft with Our Colony can not.

So they developed Our Colony, and for the same exact product, just further down the line, you guys were hired to do Hex 168. Did you find that Our Colony's performance affected your market at all? Were they burnt out? Are two ARG-type experiences almost too much for one product?

One of the early decisions we made for Hex 168 was to try and address that exact concern. We made it a much more casual game, a much more accessible game, because we knew we weren't going to be able to hit the exact same audience. Because they are burnt out, and they've seen one before, and they've already formed opinions on Microsoft's ability to launch an ARG for this product, and why work uphill? Why try to change their opinion on that? Let's aim for a new audience, one that hasn't been tapped yet. So we made it much more casual. We made it more fun, much more tongue in cheek, and ultimately I think that's the reason it succeeded -- because it didn't try to fix a mistake that was made earlier.

It kinda leads to a much larger problem with ARG's. Because they're so new, and because it's a genre that doesn't have a rulebook yet, there's a lot of people trying them, and messing up. Each time that happens, it makes it that much harder for a good one to get out there and do well. Because a lot of times those bad ones are people's first exposure to them, and if your first experience is a bad one, you're almost entirely unlikely to try again. That is the thing I'm scared of the most -- when a product comes out that makes some very large mistakes, in a very public arena.What brings you here to the Montreal International Game Summit? Are you here as a marketer, or as a game designer?

I am here as a game designer. I think that one of the directions we really want to take 42 in is as an entertainment provider, much more so than, or even in lieu of, being a marketing agency. And with a lot of our new designs, the trend lately has really been to push things in that direction. You see that in Cathy's Book, and you see that in EDOC, which embraces that new thinking, and so it was very important for me to show up to a conference like this, to kind of establish that. To say "You know what, we think of ourselves as a game company, and we think of ourselves as an entertainment company, and a storytelling company." And to prove it, we're going to talk about our games in that forum, and we're going to other industry leaders in that forum, and the things you see from 42 as we move forward into 2007 will very much embrace that thinking.